How to Start a Financial Coaching Business

How to Start a Financial Coaching Business

There are three main reasons why people struggle with finances, they include; Lack of financial knowledge: financial knowledge involves one’s ability to understand and effectively use financial skills such as budgeting, investing, saving, ...

There are three main reasons why people struggle with finances, they include;

Lack of financial knowledge: financial knowledge involves one’s ability to understand and effectively use financial skills such as budgeting, investing, saving, and managing personal finances. Unfortunately, the majority of the people are clueless about all these basic financial principles.

Complacency to financial situations: these are the type of people who tend to believe that they are destined to struggle. They therefore make no effort to earn extra money nor do they seek help to enable them to better manage the little money that they earn.

Keeping up with the Joneses: these are the people who would rather drown themselves in debt rather than appear inferior among their peers. Keeping up with the Joneses syndrome is quite common especially among young adults who are now spending money to appear wealthy instead of investing money to build actual wealth.

It has been estimated that in every 10 people, 7 struggle with at least one aspect of finances. Whether it is making investments, saving money, paying bills or even repaying debts. This situation, if not properly managed, can easily get out of hand prompting one to even file for bankruptcy. This therefore clearly justifies the need for people to get financial coaching.  

What is Financial Coaching?

It is the process of providing one-on-one sessions with clients to guide them on how to improve their financial situation by enforcing established processes and tools. The role of a financial coach is to help clients establish goals, come up with realistic plans as well as monitor and offer guidance along the way to ensure that their clients actualize their goals. 

Since the needs of clients differ, a financial coach is responsible for customizing each plan that is best suited for the specific need of the client.  

Starting a Financial Coaching Business

  1. Decide on a niche

What financial problem do you want to help people solve?

It is difficult to find a financial coach who is an expert at more than two niches. They all seek to specialize at one or two at most to make them more efficient. Therefore, if you want to start a financial coaching business, you will also need to be specific about what niche you want to cover.  

There are many types of financial services that a coach can offer such as; 

• debt payoffs

• accounting

• business finances

• budgeting

• investments

• cash flow management

• retirement fund management 

  1. Formulate a business plan

A business plan is a roadmap on how you are going to manage, structure, implement and grow your business. A common mistake that most people commit when running their startup businesses is not giving the business the seriousness it deserves. 

However, if you want to make your business profitable, you need to ensure you come up with a foolproof plan. Conduct market research to help you determine who your target market is and which businesses you are in competition with for the same market. 

You also need to determine how to go about running businesses. For example

  •  How are you going to do the coaching? A few ways to make this possible can be through in-person coaching, over the phone coaching or video conferencing. 
  •  How are you packaging the coaching program? One-on-one, group packages or are you going to offer it as a course.

Keep in mind the potential of your business to expand, therefore when making decisions ensure you settle on those that are easy to upgrade on as the business matures. 

  1. Determine your prices

This might be a bit tricky to decide on especially since you are in the business of helping people with all sorts of financial issues. It is quite easy to under-sell your services if you think of it that way but you need to remember that you are running a business and you have financial obligations to build a profitable business.  

If you are going to coach your client about deserving more money and demanding their worth, then you should also be able to do the same. 

  1. Market your services

Marketing is an important aspect for any business yet it can be the most difficult thing you will have to figure out when starting your financial coaching business. However, it will be impossible for people to know that your business exists if you do not make the effort to make them aware. Possible venues to market your services include; networking, blogging, handing out brochures and business cards or by placing ads on newspapers and magazines.

Another effective way of marketing your services if by asking for referrals from your clients, friends and family. Word-of-mouth advertising has been around for a long time and it has been proven to be effective since people are more likely to take recommendations coming from someone they know and trust.  

Also, do not forget social media marketing. The online platform has become a very powerful asset to businesses. People spend a lot of time on their laptops and phones. Therefore, if you have a strategic social media marketing plan in place then you are likely to achieve more success.

  1. Get testimonials

A financial coaching business is unlike any other business where the value for one’s money is tangible. Therefore, when starting your business, you need to make sure that you land your first clients as soon as possible and deliver good results. Then from them, you can get their testimonials to use to convince others to trust your services. Failure to which, it is going to be very difficult to convince someone that you are not going to waste their time and money (which they probably are struggling to get)

I bet you are now wondering how it will be possible to secure your first clients. Easy, start with the people around you. These are going to be your first client, commonly referred to as ‘beta clients’. These are going to be your first batch of clients (two or three). You are going to test and sharpen your coaching skills and methods with them at a reduced rate.

Once it works out, you are then going to use their testimonials to back up the credibility of your business. It makes it easy to justify your rates.  

In Conclusion

Starting a financial coaching business is not easy. You therefore need to ensure that you get it right from the onset. Direct all your focus on helping your clients achieve their financial goals and be the best at what you do and your financial coaching will well be on its way to success.